Southwestern Ontario farmland values ticked lower in 2024, a likely indication of tougher times for producers, according to a new report released late Thursday.
The 2024 edition of the Southwestern Ontario Land Values report showed average farmland values across 11 counties in the southwest part of the province dipped 1.43% this past year. Report author Ryan Parker of London-based land appraiser Valco Consultants Inc. said it marked the first time values have dipped into negative territory since the report began in 2010.
“This drop, as small as it is . . . is an indication that lower crop prices, or at least lower crop margins, have appeared to put a halt to the rapid increase in average values that we have experienced in recent years,” Parker said in the report.
Among the 11 counties surveyed for the report - Huron, Perth, Oxford, Middlesex, Elgin, Lambton, Kent, Essex, Bruce, Grey, and Wellington – Essex showed the largest average value decline in 2024, down 6.7% from a year earlier. On the other hand, Grey Country posted the largest increase, with values jumping 11.1%.
Perth and Oxford counties, which saw farmland values increase 1.7% and 3.2%, respectively this past year, continued to be the highest priced on a per acre basis in 2024 at just under $40,000. At the other end of the spectrum was Essex and Bruce (+0.1%) counties, where average per acre values came in slightly below $20,000. For all 11 counties, the average per acre value in 2024 was $26,530.
In those areas where land values showed obvious decreases, including pockets of Elgin, Lambton, Kent, Essex, and Bruce, Parker noted similar themes, such as less desirable soils, not enough demand and too much land available for sale at the same time. In contrast, those areas that showed particularly strong growth in land values often had some combination of significant livestock influence, steady demand from migration – people moving from south to north – and a limited amount of land for sale.
But while average farmland values in the southwest did show a slight softening in 2024, values for the entire study period, from 2010 to 2024, are still up 11.3%.
Farm Credit Canada’s latest full-year farmland values report, released last spring, showed the average value of cultivated farmland in Canada up 11.5% in 2023, with Ontario posting a 10.7% increase. A mid-year FCC report, released in October, pegged the average national increase in farmland values through the first half of 2024 at a much more modest 5.5%. The mid-year report put the average increase in Ontario through the first six months of 2024 at 2.1%.
FCC’s full-year farmland values report for 2024 will be released in the coming months, but Parker said in a presentation at the Ontario Agricultural Conference earlier this month the numbers in his survey generally track close to FCC’s data.
Looking ahead to 2025, Parker said he expects southwestern Ontario land values to just basically hold their own. Interest rates are likely to go lower, which may support land values, he said, but the potential for US tariffs could mean “big trouble” for commodity prices, which would act as a drag on land values.
The list here provides the average change in farmland values through 2024 by county, as shown in Parker’s survey:
